UWA PRINTERS (NIG.) LTD. V. INVESTMENT TRUST CO. LTD.

• Pages: 195-214

UWA PRINTERS (NIG.) LTD. V. INVESTMENT TRUST CO. LTD.



195

UWA PRINTERS (NIG.) LTD. V. INVESTMENT TRUST

CO. LTD.

UWA PRINTERS (MG.) LIMITED



APPELLANT

V

INVESTMENT TRUST COMPANY LTD.



RESPONDENT

SUIT NO. SC 217/1986

SUPREME COURT OF NIGERIA

NNAMANI,



J.S.C.

UWAIS,



J.S.C.

KARIBI-WHYTE,



J.S.C.

AGBAJE,



J.S.C.

WALT,



J.S.C.

9th December, 1988

Contract - Contract of Loan - Breach - Damages - Assessment - Governing principles.

Evidence - Expert opinion - Report of facts -Admissibility.

Practice and Procedure - Appeals - Damages - Lower court's decision - Interference -

Appellate courts - Underlying Principles.

ISSUES:

0





1. Whether it is proper to grant a claim for breach of contract, when the plaintiff has

suffered no loss.

2.

How is loss determined in a breach of contract of loan and who bears the burden

of proving the loss.

3.

Whether a third party who stands to benefit under a contract to which he is not

5





a party can make a claim based on the agreement between the contracting

parties.

4.

Whether a report of facts given by an expert upon which his opinion in a feasibility

study is based constitutes expert opinion requiring no proof for the purposes of

it's admissibility.

-0





5. What principles will govern the interference of an appellate court with the award

of damages as granted by a trial court.

6. Whether a 3rd party can be made liable under a contract to which he is not a

party.

FACTS:

5





The appellant was the plaintiff, while the respondent was the defendant in the trial

court. The plaintiff in 1976 contacted the defendant company for a loan of

N420,000.00 to set up a printing factory. The defendant company requested for a

feasibility report which was prepared by a Chartered Accountant and submitted to

the defendant company as a result of which the plaintiff agreed to grant the loan sub-

i0





ject to the conditions stipulated in the contract. The offer was accepted by the plain-

tiff but the defendant did not honour it's own part of the contract. The plaintiff with

the consent of the defendant approached a Bank for facilities to enable the plaintiff

operate and the defendant recommended the plaintiff for the facility. The Bank did

not grant the loan, the plaintiff had to find other means of securing the money needed

for the project and proceeded with the erection of the factory building at the total

0

5

0

5

196



NIGERIAN SUPREME COURT CASES

[1988] 3 N.S.C.C.

cost of N335,150.00. The defendants wrote a letter to Spicers Nig. Ltd. (a company

engaged in the sale of machinery) to release an exercise book manufacturing ma-

chine to the plaintiffs to be paid for by the defendant. The machine was installed

with the plaintiff but was not commissioned due to the inability of the defendant to

pay as it promised to.

The plaintiff subsequently instituted an action against the defendant claiming

inter

alia,

general damages to the tune of N1m, and special damages in which was in-

cluded, the cost of building the factory, loss of profit that would have been made on

the business venture to the tune of N1m. At the trial, the plaintiff tendered the sur-

vey and valuation report as complied by an estate valuer in respect of the building,

it was also shown in evidence that the defendant had been sued by Spicers Nig. Ltd.

in another action for the cost of exercise book manufacturing machine. The trial

Judge found for the plaintiff and awarded the plaintiffs damages to the tune of

N1,499,000.00. the appellant incured no direct financial loss. His compensation

however lies in the award of damages for the breach of contract of loan of

N420,000.00 as a result of the inconvenience occasioned him by such breach. The

damages are not meant to cover the cost of the machine.

The defendant being aggrieved appealed against that judgment to the Court of

Appeal which allowed the appeal and reduced the damages and cost awarded to

the plaintiff from N1,499,900.00 to N43,992.75 on the grounds that the plaintiff did

not discharge the onus which lies on him to prove it's claim as specifically estimated.

The plaintiff dissatisfied with this judgment appealed to the Supreme Court con-

tending that the Court of Appeal erred in reducing the damages awarded by the trial

court.

HELD:

1.

That to allow a claim arising out of a breach of contract for which the party

claiming is enjoying a benefit will be inequitable. In the instant case as far as the

factory building is concerned, the appellant suffered no loss though he was

prompted to erect it as a result of the contract for the grant of a loan to build

same and which was subsequently breached by the respondent.

2.

That where the breach of contract is a failure to lend money, the basic loss is

the difference between the terms upon which the borrower had made the loan

and terms upon which he can go into the market and effect a substitute for

himself. The measure of damages is the loss sustained by the borrower through

the breach. The damages may be large small or merely nominal according to

the circumstances and the burden of proving the amount of the loss sustained

rests on the claimant. In this case. the appellant is entitled to recover damages

for breach of the agreement to make the loan.

3.

That a third party once he is not a party to the contract though he stands to

benefit under the contract, cannot institute an action to claim under the contract.

In this case though the machine was delivered and installed in the factory, the

appellant was not a party to that contract, it was between the respondent and

Spicers Nig. Ltd. There was no doubt that had the machine been commissioned,

he would have been a beneficiary and the responsibility of defraying the cost of

the machine would have been taken over by the respondent, or the appellant to

be reimbursed by the respondent had he paid. As shown in evidence Spicers

Nig. Ltd. already instituted an action against the respondent to recover the cost

of the machine. As far as this is concerned between the appellant and any other

party known to the respondent. Thus the Court of Appeal was perfectly justified

in disallowing this head of damages as speculative.

4.

That an expert may give his opinion upon facts which are neither admitted nor

approved by himself or other witness in his hearing at the trial or on matters of

common knowledge but where the opinion is based on the report of facts, these

facts unless they are within his personal knowledge, must be proved